Category Archives: The Economy

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Words are just noises we use to communicate with each other. To the extent that we agree on the meanings of the words we use, we are able to communicate well.

But to the extent that the words are used to mislead or confuse, communication is damaged.

As the general population has become more aware of, and concerned for, “the natural world” (that is, the rest of the physical world beyond ourselves and other humans, as if we were somehow not natural), the word “natural” has become more common in stores in recent years. And, as the trend leads to more sales, the use of the word “natural” has become ubiquitous on the labels of products in grocery stores.

having or constituting a classification based on features existing in nature

growing without human care; also : not cultivated *natural prairie unbroken by the plow*

existing in or produced by nature : not artificial *natural turf* *natural curiosities*

relating to or being natural food

living in or as if in a state of nature untouched by the influences of civilization and society

closely resembling an original : true to nature

marked by easy simplicity and freedom from artificiality, affectation, or constraint

having a form or appearance found in nature

And, under “natural food”:

food that has undergone minimal processing and contains no preservatives or artificial additives

So, what does “natural” mean on a food label? Is it “food that has undergone minimal processing and contains no preservatives or artificial additives” or something close to that?

Well, at least in the United States, no.

Keep in mind that those of us in the United States, eating the “standard Western diet”, are part of the most overfed and undernourished population in the world, with the most expensive health care and the worst health of any “developed” nation.

Hardly a glowing tribute to our food system, which focuses on producing heavily processed items that should be food, but are not.

So why do so many of our food packages come with the word “natural” on the label? Because it communicates a benefit and assurance that leads to increased sales and higher profits, and in the United States is unregulated on food labels – anybody can claim that something is natural, without having any need for it to be true, or having any liability if it is not.

Hence, corporation profits are at an all-time high.

And we swallow this misuse of our language along with the food.

Meanwhile, our health continues to decline.

Of course, we could question what is actually in what we eat, and make better food choices, but that would take personal effort and responsibility as well as better labeling.

Another thing to keep in mind: “natural flavor” means absolutely nothing: everything has flavor, even used engine oil! So, what does the term “natural flavor” mean when you find it on a food label? It means there is something in this product that you probably don’t want to eat, but it is a cheap substitute that tastes like an ingredient that you would want to eat, similar to the “artificial” flavors.

A number of folks were sitting around waiting for service work to be finished. Naturally, we were talking about various things, and I mentioned that some of the problems they were talking about were a result of, or worsened by, high population.

As you might imagine, there was a period of silence, followed by a number of protestations. One man said that, while he and his wife had chosen to have 2 children, he had “a right” to have as many children as he wanted. I asked where does that right come from. His reply was, “It’s natural, it’s the way we are.”

Further conversation ensued, and he said he thought that, as long as he could support them, he should be able to have as many children as he wanted. I asked what happens if he has them, then can’t support them. He sort of stumbled around the idea that “family will do it.” “But what if your family can’t or won’t” He said they would.

Well, I was reassured. You bet.

Thus was avoided any recognition that we live in a finite world, and there is a link between individual action and global problems. This, of course, means that we have no responsibility for the effects of our personal choices on ourselves or others.

Rights without responsibilities – the American Dream.

But what was interesting to me was his reasoning and support for his position: “It’s natural. It’s the way we are.”

Once again, here was an example of supporting a position with a reason that would be laughed at in support of any number of other human activities.

If someone makes us mad, or has something we want but won’t give it to us, we can simply kill them and take it. It’s our right, because it’s natural. It’s the way we are. We are told that humans have been doing just that for most of our history, and prehistory, for that matter.

Of course, the other person may kill us instead, but that’s how it goes. It’d natural. It’s the way we are.

If I want to live in your house, I can simply throw you out and take it. If you can stop me, you stay. If not, I get your house. Until you decide to take it back, or someone else decides they want it. It’s natural. It’s the way we are. We’ve been doing it for thousands of years.

Puts mugging in a different perspective, doesn’t it?

When I was a child people who acted like that were called “savages” or “uncivilized.”

When I was in college I was told that people like that were “mentally ill” and had “poor impulse control.”

I suppose that is still true, but now we call it “Standing up for our rights.”

Here is another example of a common double standard widely supported by economic conservatives.

Keep in mind that we all have double standards. It’s part of the friction of living in groups. And we’re all pretty righteous about our own double standards. Things get petty and can be bothersome, but we usually, eventually, work things out, because we need to get through the day.

In the United States, at both the state and national levels, over the last few decades a particular double standard has become more and more apparent: Business welfare is good. Working class welfare is bad

Here is the conservative line about “Welfare”, as stated by any number of nationally prominent Republicans:

The government needs to cut expenditures, particularly “entitlement programs” such as Medicare* and Social Security**, but pretty much all social welfare programs. If the government fails to do so the economy will collapse, as the government does not have the revenue to pay for these programs. In addition, giving people something for doing nothing simply encourages a feeling of entitlement and leads to increased crime.

OK. Let’s accept these arguments, shall we?

But then, I don’t see any reason why they should be limited to “entitlement programs”. If the arguments are true, shouldn’t they apply to businesses too?

How about if these business executives follow their own advice?

Businesses should not receive special support from government. Any benefit a business receives from government should be paid for***: businesses should pay a tax or a fee for those services the government provides, in direct proportion that the business benefits from that service. Any other cost/use relationship would be unfair, as it would either put an unfair burden on the business (when the fees/taxes paid exceed the benefit) or give preferential unearned benefits (“welfare”) to the business.

Examples of services the government provides businesses: a legal system that is essential to the creation of contracts. A court system that is essential to enforcement of contracts. A free press which maintains a vibrant communications system for transacting business, particularly advertising and on-line services. A public road system that makes it possible for people to get to work, to shop for products and services, and for the delivery of products. A public school system that prepares potential employees for work. A police force that protects business property and people from harm

Shouldn’t business pay their fair share for these services the government provides us all?

And why should the rest of us pay for bailouts for businesses “too large to fail”? A group of investors selects a management team that runs the business into the ground, and then expects a government bailout to cover their bad debts. Can you think of a better example of “welfare” or of a group with a sense of “entitlement”?

Perhaps the conservatives are right: if businesses paid for the benefits of government, instead of letting the working class foot the vast majority of the bill, the economy would be more balanced.

After all, giving businesses something for doing nothing simply encourages a feeling of entitlement and leads to increased crime.

What do you think?

Notes:

*Medicare is paid for primarily by a tax on income. As with any insurance, benefits are based on coverage and need. Medicare is not health care–it is health insurance, which is not the same thing.

**Social Security is completely paid for by a tax on income. As with any pension plan, the “benefit” bears a direct relationship to the amount paid in (Social Security taxes) by the recipient, and how long ago the tax was paid.

***It is well documented that many businesses, particularly very large corporations, pay little or no income taxes, even in years where they make record profits.

We all have double standards. It’s part of the friction of living in groups. And we’re all pretty righteous about our own double standards. Things get petty and can be bothersome, but we usually, eventually, work things out, because we need to get through the day.

But when the government is paralyzed by double standards it goes beyond petty and bothersome.

In the United States, at both the state and national levels, over the last few decades a particular double standard has become more and more apparent: Business debt is good. Government debt is bad.

Here is the conservative line about the government, the budget and the national debt, as stated by any number of nationally prominent Republicans:

Government should not spend more than it takes in. Going into debt is bad. The government needs to eliminate the deficit and to pay off the national debt.

To do so, according to these same prominent Republicans and any number of conservative pundits, The government needs to cut expenditures, particularly “entitlement programs” such as Medicare and Social Security, but pretty much all social welfare programs.

And, of course, the government should not raise taxes, as raising taxes during times of financial slowdown will stifle the recovery.

OK. Let’s accept those arguments, shall we?

But then, I don’t see any reason why they should be limited to our government. If they are true, shouldn’t they apply to individuals and businesses too?

How about if these prominent Republican business executives follow their own advice?

Businesses should not spend more than they take in. Going into debt is bad. They need to eliminate their deficits. Therefore, businesses can buy only what they can afford to pay for with cash: no new buildings, no new machinery, no stock for sale, no purchases without the cash to pay for them.

And the other aspects of responsible economics: they should cut expenditures, particularly “entitlement programs” such as executive bonuses and golden parachutes, but pretty much all expenses beyond basic salaries and materials and processing expenses.

And, of course, they should not raise prices, as raising prices during times of financial slowdown will stifle the recovery.

How’s that for returning to sound economics and strengthening the economy?

Of course it eliminates lenders, and terminates most of the financial industry.

“We used to make stuff in this country. Build stuff. Now, we just put our hands in the next guy’s pocket.” – David Simon, dialog from The Wire

I live on a farm. When I go “into town” I often pass by workers in fields. They are doing the essential everyday work needed to feed us, all of us, including me.

In my case, I could raise my own food, and in times past I have. But I don’t now–the work is too hard and I can buy even the best organically raised local food for so little money that I raise a little of what I eat, and buy the rest.

But recently I have been thinking about the changes coming with the diminishing availability of petroleum and the implications of this loss of this cheap, portable, dense energy source and raw material.

To the extent that these things were done before cheap and abundant energy was available, human beings did it: slaves, peasants, indentured servants or simply hired hands. And, of course, women, who for most of history, at least in the Western tradition, have been essentially slaves to men

So where will the labor (energy) come from to keep us in iPads? Well, it probably won’t, because as we adjust to a future with less energy to substitute for human labor, we will shift our desires to more realistic levels.

We will return to making things that are repairable, and re-develop the network of people, places and supply lines so that these repairs can be done. We will each have less stuff, not so much because our desires for stuff will be unfulfilled, but because our desires will become more reasonable.

We will each learn to take more care, and will remember when we were happier with less stuff. Have you ever thought how strange it is that we have much bigger houses than we did even 50 years ago, yet there is a flourishing business renting storage space to people where they can put the stuff that doesn’t fit in their houses? We obviously don’t need the stuff, or it would be near to us, and being used.

And, most probably, each of us will simply spend more of our time doing things that are directly productive of real wealth: growing food, building furniture, raising children, nurturing community…

And to do that, we will need to recover the lost skills needed to practice true economics – the managing of our households: providing air, water, food, clothing, and shelter as well as rewarding companionship and meaningful occupation to ourselves, our families, our friends and our communities.

It will not be easy. It will be hard work, but there are those of us that still have the skills and experience to do it, and they can teach the rest of us.

And those workers in the fields are some of the most important of those teachers.

In the meantime, even though others sometimes laugh at me when I do, I always give a little wave of respect and appreciation when I see workers in a field.

I recently passed by 3 people holding signs about the Occupy Wall Street protests.

They held signs informing all to see that “we are the 99%”

My wife reminded me that we are part of the 1%. She is right. We are. But probably not the 1% you are thinking of.

We are farmers.

We work in a business that is so demanding physically, and so poorly paid, that a major proportion of our co-workers are in this country illegally, in large part because only the most dedicated legal residents will do the work we do, under our working conditions, for the pay it provides, and they are not enough to get all the work done.

We do work that is so dangerous that we are exempted from the protections of the Occupational Health and Safety Act (OSHA), created to protect workers from hazardous working conditions and dangerous materials.

In most states we are exempted from minimum wage laws. In most states we are effectively prohibited from forming unions, and in many cases have no real guarantees we will even be paid for our work, nor any recourse when we are cheated.

We work in a business that traditionally buys everything at retail and sells everything at wholesale. We are generally unable to set our own sales prices, and generally cannot negotiate purchase prices. To a large extent, prices are set by corporate conglomerates and investment speculators.

And yet we are absolutely essential to the welfare of everyone in the country.

It is possible to live without an iPhone, a cell phone or athletic shoes, it is even possible to live without a second dress or pair of pants, but it is not possible to live without food.

Yet the economics of growing food are so bad that in my lifetime, in the United States, we have gone from over half the population growing food to less than 1% doing so.

We–my wife and I and people like us–are the 1%. Like the majority of farmers in this country, we are 65 years old or older, and we are dying off.

And with the pay so low, and the cost of land so high, the next generations of farmers are blocked from taking our places because they cannot afford access to land.

Who will feed the people when we are gone, and where will they grow the food?

I’ve been working on that question for over 20 years, and I don’t know the answer. The corporate conglomerates and investment speculators don’t know (and apparently don’t care.)

My guess is, you probably don’t know either, but, as you probably plan to continue eating, you may want to pay more attention to the problem.

Political strategists agree that there are essentially three groups of people that determine who wins office. These groups are the right, the center and the left. (This “right, center, left” fragmentation is all relative. You can make a very good argument that there is no left, and hardly any center in politics in the United States, just degrees of the right.)

The following are some thoughts on moving the country toward the (relative) left, and recovering democratic values.

From the above view comes the political strategy that for a candidate to win election they need either the right and a majority of the center, or the left and a majority of the center, but you cannot win with only the support of the right or the left, as they are not in themselves big enough blocs to carry the vote.

Assuming support from the extreme and courting the middle has been the predominant strategy of both major political parties for some decades (Thanks, Ronnie!) As the Republicans moved farther and farther to the right, the Democratic party did the same, based on the ideas that the left had nowhere else to go, so would continue to vote Democratic, and more of the middle would vote Democratic as the party’s platform moved right.

It has worked, more or less, off and on, for the Democratic Party. It has been a disaster for the citizenry, for the economy, and for democracy.

What is rarely talked about is the following: Of the people eligible to vote, fewer than half register to vote. Of the people registered to vote, fewer than half vote regularly, and a large number of those who do vote, only vote for some offices. Since the majority of political offices are won by a small majority, this means that about an eigth of those eligible to vote regularly determine who will make policy and law.

It is said that there are many reasons that people who do not register, or who register to vote but do not, fail to cast ballots: apathy, too busy, confused, etc. I contend that the majority of those who do not vote fail to do so because they feel it will make no difference. They feel that the candidates are too similar to each other, and too dissimilar to “regular people”. Or they feel that the choice is “between two evils” and when you chose the lesser of the evils you still have an evil. Or they feel that “the government” is too entrenched in the way things are, and will not change. Or they feel that corporations buy off whoever is elected, and so it does not matter. Or some combination of these reasons and more. The net result is the feeling, “Why bother to vote? It won’t make any difference.”

And experience shows them they are right. I believe that the legacy of Obama’s election, and his subsequent failure to make substantive change, will be deeper apathy toward democracy. And it is justified. However, I find this apathy unacceptable.

Obama’s astounding success was, I believe, because he gave people hope for real change – that he was a person who knew what daily life was like for most people and wanted to make the changes in government and the country most people believed needed to be changed. That is exactly what he said during the campaigns, and what he promised when he took office. He has failed on almost every promise.

He has accomplished a number of generally minor things, it is true. But look at his successes and failures: the best thing you can say about him is that he is not as bad as the Republicans, and if they had won, things would be worse. I agree, but this is the thinking that has taken us farther and farther down the path of less democracy, less prosperity, less security, less independence, less of virtually everything that makes democracy democracy and life worth living.

So, what do we do in this bleak situation? That is the point, after all: what do we do?

The two major parties were once challenged by third parties, but they have enacted laws and regulations that make it nearly impossible for a third party to win any significant number of elections. The solution, I believe, is to rebuild democracy from the ground up, from within the Democratic Party.

I believe that the way to win elections, which is what political parties are all about, and to move the country left, back to democracy, is to energize those who have not been interested in registering and voting. It worked for Obama, although he did it primarily by lying. Let’s do it for real, and let’s start locally. In every city, in every county, at the state level, and nationally, let’s get real progressives elected – by setting a real platform of real change, and holding our candidates to it – no excuses. If they vote against the platform, they lose the support of the party. If they do not actively advocate the platform, they lose the support of the party. Then we find another candidate who will advocate and support the platform

Our platform would be along these lines:

Let’s demand single-payer health care, not insurance; let’s return to the Constitution – no wars without specific congressional approval and a specific, formal declaration of war by the Congress; let’s end military spending for prosecution of war without specific congressional approval; let’s require full accountability by the military – no more “missing” money in the defense department; let’s demand withdrawal of all combat troops in foreign countries and limit military spending to the average percent of the GNP (or similar measure) that other countries spend; let’s retrain returning troops for the jobs needed to build and install renewable energy systems throughout the entire country in order to end our dependence on oil and coal (foreign or domestic), and then employ them to do it; let’s re-institute import tariffs to support domestic production; let’s index the cost of living for Social Security and similarly indexed programs to the real costs faced by seniors and indices appropriate to the other programs; let’s reform the tax code to simplify it and create equity between individuals and companies; let’s eliminate for-profit corporations by converting them to partnerships, and let’s eliminate the liability shield; let’s make it clear that only human beings have constitutional rights, not created legal entities like corporations; let’s prohibit all but registered voters from making political contributions, and make those contribution records public; let’s make sure that all who wish to register to vote, and who are eligible, can easily register; let’s make sure that all registered voters can easily vote and have their votes accurately counted.

Let’s look at government regulation as it relates to people’s actions.

The Reasoning Presented: individual people have a tendency to act in their own interests, often to the detriment of others. If left unchecked, at least some people will prey on others – the young, the small, the weak, the elderly, the ill, the poor. This is a bad thing, and should be prevented, or if it cannot be prevented, at least punished.

Therefore, we must, as a society, through our elected and appointed representatives – our government – regulate the actions of people, in order to allow the majority of people to live their lives with some amount of peace and security.

Regulation of people, through laws and regulation, enforced by police and courts, is necessary to civil life.

Let’s look at government regulation as it relates to business’ actions.

The Reasoning Presented: individual businesses have a tendency to act in their own interests, often to the detriment of others. If left unchecked, at least some businesses will prey on others – people and businesses. This is a bad thing, and should be prevented, or if it cannot be prevented, at least punished.

Therefore, we must, as a society, through our elected and appointed representatives – our government – regulate the actions of businesses, in order to allow the majority of people to live their lives with some amount of peace and security.

Regulation of businesses, through laws and regulation, enforced by police and courts, is necessary to civil life.

Let’s look at the conservatives’ story of government regulation as it relates to business’ actions.

The Reasoning Presented: Businesses are different than people. Businesses thrive only when they serve their customers. It would be self-defeating for a business to act in a way that did not serve its customers. Regulation of business raises costs unnecessarily, increasing prices and hurting people. Regulating business only hurts the interests of the public.

Therefore, we must, as a society, through our elected and appointed representatives – our government – allow businesses to operate freely and without restrictions. This free market will regulate business actions, providing the best of products and services to the public, and the most responsible business “citizens” which will help the majority of people to live their lives in peace and security.

Regulation of businesses, through laws and regulation, enforced by police and the courts, is detrimental to civil life

Given the actions of business, as experienced in the United States’ reduced regulatory status during the last decade, this argument is a little silly, isn’t it?

You know how there are some crystal clear moments from your past that don’t seem to be particularly important, but nevertheless they come to mind at odd times and seemingly from nowhere?

I remember hearing that at some point in our lives each of us will breathe an atom of oxygen that was breathed by Leonardo da Vinci. It wasn’t that da Vinci breathed more oxygen than others, it was that there is a finite number of molecules of oxygen, we breathe in so many during our lifetimes, and air movements over time (as well as the life cycles of oxygen) that the odds are we have breathed at least one molecule of oxygen that was breathed by almost everyone before us.

Whoa! Pretty amazing. To think that each if us has shared atoms with virtually everone who has lived before us. And with the plants, too, because of course they are part of the cycles of life and death.

A simplification, of course, but later in my life it led me to think about the implications of finite amounts, and of limits, and it led me to a perspective I was never taught in school.

There are limits to the Earth’s resources. It does not take a great mind to understand that. And yet we act as if there were no limits.

We pollute the air. We poison the land. We contaminate the water. We destroy the forests. We have developed a species that lusts for more, more, more.

We have lost our understanding of enough.

A very smart sales manager once told me that in the course of my work in estate planning I would meet two kinds of people: those who worked for a living, and those who already had all the money they would ever spend. Most of us are in the first group. For the second group, money is not about paying the bills, or even about being extravagant – it is about power and control.

As I have written many times before in this space, money is not wealth. It is a tool to manipulate wealth. Wealth is access to clean air, pure water, and nutritious food. Wealth is having adequate clothing, safe shelter, reasonable health, satisfying companionship and meaningful occupation.

So long as money aids in the transfer of wealth between those who have access to wealth or who produce wealth, money is an effective tool, and worthwhile.

But when those who make bread no longer accept money for the bread, money becomes valueless in relationship to bread. Money only works as a tool to manipulate wealth when money can be traded for wealth.

And yet we live in a culture that worships money, and the possession of money.

And it is killing us.

Polluted air is killing us. Poisoned land is killing us. Contaminated water is killing us. Deforestation is killing us. Our lust for more, more, more is killing us.

The United States has the most overfed and undernourished population in the world, with the most expensive health care and the worst health of any “developed” nation.

We are a dying culture, and we are rushing into our death with open arms and cries of “More! More!” on our lips. Our vaunted knowledge and technology cannot “save” us. They not only do not offer us solutions, in pursuit of ever more stuff they are the core of the problem.

Isn’t it time to re-learn the lessons of history, and live within our means? Isn’t it time to learn to live in balance with the rest of the Earth: the air, the water, the land, the flora and fauna?

Isn’t it time we regained our perspective? Isn’t it time to look at the reality of our self-destruction and say, “Enough!”

Our economy is in tatters, in the United States in general, and in Oregon specificlly.

What is an economy? The word economy comes from the Greek oikos – house, and nemein – to manage. At its most basic, economy means managing the house. “Keeping your house in order”, if you will – making sure that the needs and obligations of you and your household are met: clean air, pure water, nutritious food, adequate clothing, reasonable health, safe shelter, rewarding companionship and meaningful occupation.

These are true wealth – not money. Money is only worthwhile to the extent that it can provide true wealth – a handy tool to make barter easier, but not wealth in and of itself.

But except for some aspects of food costs, home sales and unemployment numbers, “economic reports” rarely deal with these matters. Economic reports focus on “the financial markets” i.e. investments in stocks, bonds, derivatives, etc., import and export numbers, and foreign affairs to the extent that they impact investors.

Economists focus on investments, not people: on earning money without producing anything, without actually producing wealth. In fact, protecting or producing real wealth, in particular clean air, pure water, nutritious food, and reasonable health, are considered drags on the economy.

Rewarding companionship and meaningful occupation aren’t even on the radar.

Even a casual observer can see that “The Economy” as we measure it, discuss it, theorize about and manage it, has little relationship to most people’s households.

Hence, it is possible to have “a jobless recovery.” We have an economic “recovery” despite about a fifth of the population’s inability to earn a living. We have an economic “recovery” where we do not produce goods, but must continue to consume them, and our ability to do even that is shrinking.

Our economic gurus declare an economic recovery based not on how well we “keep our house in order”, but on how securities prices reflect the wealthy’s ability to run up the prices of investment instruments. The reality of most people’s lives is just clutter to the experts, and so it is left out of the equation.

These same experts are the ones who say we are experiencing a “jobless recovery.” An economic recovery without jobs is a concept only those so wealthy they do not produce any wealth could even imagine. This explains why the only people who think things are fine are the very wealthy, for whom things actually are fine, for the moment, because the citizenry has been stuck with the bill for the wealthy’s failed gamble on the imaginary.